An irreconcilable breakdown in trust
Sometimes a report of a financial remedies consent order case can read like a sort of horror story, in which the parties find themselves caught in a downward spiral, in which a final resolution seems to get further away, rather than closer.
As I began reading the report of Mr Justice MacDonald’s recent judgment in the case YM v NM (Maintenance Pending Suit) I had no idea what I was letting myself in for. I had thought from that title that the judgment was simply about a wife’s application for maintenance pending suit, i.e. an order that the husband pays her temporary maintenance pending the final outcome of her final remedies claim.
Instead, I was treated to a saga setting out how the parties had originally appeared to settle matters by agreement, only for them to subsequently suffer what Mr Justice MacDonald described as “an irreconcilable breakdown in trust.” The result is that, far from concluding the matter, the wife is now trying to go back to square one. The parties could be as far away as ever from a final resolution.
As Mr Justice MacDonald said, at least in relation to part of it, the dispute between the parties “is positively labyrinthine in its history.” I will, therefore, do my best to keep my simplified summary to an absolute minimum.
The parties began a relationship in 2000 and were married in 2006. They have two children, a son, who is 11 years old, and a daughter, who is 8 years old. In 2014 the parties relocated with the children to England. The marriage broke down in 2017.
During the course of the marriage, the husband was involved in industry in Russia, from which it is said he accumulated substantial wealth. The wife estimated the husband’s wealth to be some £500 million.
Following the breakdown of the marriage, the parties signed an agreement which was expressed to be in full and final settlement of all claims that each may make against the other in connection with their marriage. The agreement provided the wife with assets of some £32 million. The wife now contends that she was pressured into signing the agreement by the husband. The agreement was incorporated into a consent order, which the wife alleges she signed under duress from the husband.
The wife is now applying to have the consent order set aside, and her application has been fixed for hearing in June. Meanwhile, she has made the maintenance pending suit application, along with an application for an injunction preventing the husband from selling the former matrimonial home (which was purchased in 2014 for £35 million), unless he agrees to her proposed terms for an escrow agreement with respect to the sale (basically, an agreement ensuring that he deals with the net proceeds of the sale as agreed). It is these applications that the judgment deals with.
Mr Justice MacDonald’s summary of the background to the injunction application is noteworthy. He said:
“…the genesis of the current dispute is a depressingly familiar one. Namely, an irreconcilable breakdown in trust. The wife does not trust the husband to deal honestly with the proceeds of any sale of the former matrimonial home and contends that the same will only be sufficiently safeguarded by their being an escrow agreement in terms agreed by the parties … By contrast, the husband contends that he can be trusted …”
Yes, depressingly familiar, I’m afraid.
The wife’s applications
OK, I will summarise these very briefly.
Both applications failed and were dismissed.
As for the maintenance pending suit application, Mr Justice MacDonald was satisfied that it would not be appropriate to grant an order for maintenance pending suit before the determination of the wife’s substantive application to set aside the consent order. The wife was not in a predicament of real need.
As to the injunction application, the wife had not provided objective evidence that there was a real risk of the husband dissipating the proceeds of the sale of the former matrimonial home. Mr Justice MacDonald was therefore satisfied that it was not appropriate to grant the order sought by the wife.
You can find the full judgment here.
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